The first ever GAO (Government Accountability Office) audit of the Federal Reserve was carried out in the past few months due to the Ron Paul, Alan Grayson Amendment to the Dodd-Frank bill, which passed last year. Jim DeMint, a Republican Senator, and Bernie Sanders, an independent Senator, led the charge for a Federal Reserve audit in the Senate, but watered down the original language of the house bill(HR1207), so that a complete audit would not be carried out.

Ben Bernanke (pictured to the right), Alan Greenspan, and various other bankers vehemently opposed the audit and lied to Congress about the effects an audit would have on markets. Nevertheless, the results of the first audit in the Federal Reserve's nearly 100 year history were posted on Senator Sander's webpage earlier this morning.

What was revealed in the audit was startling:

$16,000,000,000,000.00 had been secretly given out to US banks and corporations and foreign banks everywhere from France to Scotland. From the period between December 2007 and June 2010, the Federal Reserve had secretly bailed out many of the world's banks, corporations, and governments. The Federal Reserve likes to refer to these secret bailouts as an all-inclusive loan program, but virtually none of the money has been returned and it was loaned out at 0% interest. Why the Federal Reserve had never been public about this or even informed the United States Congress about the $16 trillion dollar bailout is obvious - the American public would have been outraged to find out that the Federal Reserve bailed out foreign banks while Americans were struggling to find jobs.

To place $16 trillion into perspective, remember that GDP of the United States is only $14.12 trillion. The entire national debt of the United States government spanning its 200+ year history is "only" $14.5 trillion. The budget that is being debated so heavily in Congress and the Senate is "only" $3.5 trillion. Take all of the outrage and debate over the $1.5 trillion deficit into consideration, and swallow this Red pill: There was no debate about whether $16,000,000,000,000 would be given to failing banks and failing corporations around the world.

In late 2008, the TARP Bailout bill was passed and loans of $800 billion were given to failing banks and companies. That was a blatant lie considering the fact that Goldman Sachs alone received 814 billion dollars. As is turns out, the Federal Reserve donated $2.5 trillion to Citigroup, while Morgan Stanley received $2.04 trillion. The Royal Bank of Scotland and Deutsche Bank, a German bank, split about a trillion and numerous other banks received hefty chunks of the $16 trillion.

"This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."- Bernie Sanders (I-VT)

When you have conservative Republican stalwarts like Jim DeMint(R-SC) and Ron Paul(R-TX) as well as self identified Democratic socialists like Bernie Sanders all fighting against the Federal Reserve, you know that it is no longer an issue of Right versus Left. When you have every single member of the Republican Party in Congress and progressive Congressmen like Dennis Kucinich sponsoring a bill to audit the Federal Reserve, you realize that the Federal Reserve is an entity onto itself, which has no oversight and no accountability.

Americans should be swelled with anger and outrage at the abysmal state of affairs when an unelected group of bankers can create money out of thin air and give it out to megabanks and supercorporations like Halloween candy. If the Federal Reserve and the bankers who control it believe that they can continue to devalue the savings of Americans and continue to destroy the US economy, they will have to face the realization that their trillion dollar printing presses will eventually plunder the world economy.

The list of institutions that received the most money from the Federal Reserve can be found on page 131 of the GAO Audit and are as follows..

Reader Comments

When the only solution is collapse. These 'investors' have become addicts awaiting the next 'fix' from the Fed, as they are led deeper and deeper into their own graves oblivious the whole way. Simple addiction.

And none of you would know about this if it weren't for a man who eats, sleeps, and breathes privatization. His entire political career has been built on it. $16 tril in secret bail outs is what you get when the fed govt is regulating bankers. Only the free market can truly regulate bankers since no one would use a dishonest bank on a level playing field. When the fed govt regulates them their is no incentive to be honest, in fact the opposite happens the more profit comes from the more they gamble with your money. Thus honest bankers make the least money when tax dollars prop them up.

The federal govt will never, in this reality or any other be able to regulate banks into honesty. And if any of you think these secret bail outs are because some regulation or another was removed you are sadly mistaken. Unlimited, unending bail outs was the plan since 1913. This is the fruit of a 100 years (at least) of the international bank cartels labor. This fruit doesn't taste very good does it?

And yes, this IS a form of socialism. Taking money from one group of people and giving it to another without their consent. See #3

Definition of SOCIALISM
1
: any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
2
a : a system of society or group living in which there is no private property b : a system or condition of society in which the means of production are owned and controlled by the state
3
: a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done

I haven't noticed the fed govt regulating the bankers. It appears to me to be quite the opposite - the bankers are very much regulating (as in making the regulations) the fed. govt.

I don't really see free market regulating bankers, either, even if there ever could be a free market. As I understand it, the early years of banking, when there was very little govt to regulate anything, had plenty of economic woes. At least some of the woes were due to unregulated bankers.

Seems to me it gets down to psychopathy - as long as psychopaths are free to screw up other people, they will do so, by whatever means is available, including financial institutions.

By looking at the GAO audit document I found one statement as false in this article.

First, 16 trillion looks impressive, but looks like it is total aggregated amount of money given to the banks, for example if a bank got a 1-day loan of 10bln for 30 days, it would print as 300bln even though the bank got only 10 bln. The max amount borrowed at the same time is 1,2 trillion.

Second, the statement that money were virtually never repaid may not seem to be true if taken to the court, but comparing the max $ borrowed ~ 1.2 trillion, and that all this money eventually 'repaid' by banks, but ended up as MBS or other paper on FEB balance sheet (even more if taking into account FED balance sheet of 800bln in 2008 and close to 3 trillion in 2012), hence on shoulders of the taxpayers if something goes wrong. Also by looking at US debt accumulated since 2008 (5 trilion and growing) we can see what price the US public paying, not to mention the world.

Yes, but like most derivatives, these 'banks' are living at the discount window of the Fed as well, which is why the market eagerly awaits news of its next feeding, its next 'fix' from the Fed.

Also, this $16 trillion is on top of the previous publicly noted transactions to pump up the Fed's balance sheet, as most of it is recurring if not accumulative. Last I heard was 33 to 35 trillion in debt output, which gets listed in oh so many clever ways of concealment. It's also why the problem cannot be fixed, the virus has taken over the host completely and we merely await the death notice. The grave has already been dug, the 1.5 trillion hollow point bullets are being acquired for the herd's sleeptime, and you have to admit, the dumbing down process has been very successful here in the States, so much so, that the PTB might have a problem getting their 'revolution' started here at home. One program counters the other program. If 'trouble' isn't started soon, this 'American' herd will be useless for energy consumption and that won't go down well come suppertime.

dimichsdg, What you say, in effect, is that the article is LYING when it says "The Federal Reserve likes to refer to these secret bailouts as an all-inclusive loan program, but virtually none of the money has been returned and it was loaned out at 0% interest."

I agree with Pres. Andrew Jackson, RIP, and also others' comments re the Fed's ongoing thefts since inception. That said, the article reads as if 16 trillion was literally given away, permanently, to banks, et al, to keep them afloat. If that were true, they could have instead given over $60,000 to each American Citizen instead, per the 2000 census.

What I'm asking you, "dimichsdg" is,
1. Please clarify your MBS, FEB's and other fancy acronyms. Not all of us are CPA's.
2. How much has been loaned out - at 0% interest - and remains unrepaid?
3. Assuming a simple interest rate of 12% per annum (to make it easy for you as that's one percent per month - I'd say that's reasonable given the compounded 24% and more which these selfsame "banks" charge us on credit cards) - what has been the value of those 0 % loans which YOU - but not the article - say have been repaid?

These requests should be easy for you as you obviously are familiar with the details and have "reviewed" the original report.

I, for one, await your clarification with bated breath. Or at least I would if I didn't fear death by deoxygenation (or whatever it's called.)

This news is almost 12 months old. First reported by the theeconomiccollapseblog.com on 2nd December, 2011.
Where have you been unelected.org?

Part of the reason i frequent SOTT.net less these days is because of the consistently hard to find or late financial pieces of gold.

Laura, what happened to the 'Economic Collapse' section that existed a couple of years ago? Now it feels as if economic related items are lost amongst irrelevant articles. Sorely miss the economic section.

For anyone interested, here is the link to the original article i read in December last year. (another 127 grey hairs since then)
[Link]
For all financial related news, i highly recommend the SGTreport.com

Gold and silver have broken above long term support - 200 Day Moviing Average - and looks to repeat the pattern from 4 years ago, as it has retest to the downside for a year, same as 4 years ago. So, at minimum, a 2.5x multiple to be expected, BUT, remember this is a curve going parabolic, so it should look like the DOW chart from '95 to 2000 which squeezes price to a multiple and time frame to do so as well.

Probably $10,000 oz by the time the dark star/comet cluster arrives in '14 especially if the PTB pull the rug out on the markets/economy with no further 'fix' from the Fed for the addicts on the Street. Withdrawal symptoms aren't a pretty sight, though some types get entertained by them. If they are going to generate the necessary 'escape velocity', then that rug better be pulled soon, lest the same 'shocked' symptoms get repeated for another cycle, which is of benefit to neither side. Either way, there is only the stock market in the USA left for all those trillions of fiat currency in digital form to run to, where o where will they go when it too collapses? The precious metals are all that's left and there isn't much of it, no where near enough for any of that digital dollar crowd. That sinking feeling is already making the rounds, and once any retest is attempted, which you could say already happened, given the price action on Friday (down early and then 'hammering' up the rest of the day as it bounced off that 200 dy MA), then it will be hard to hide the obvious uptrend and all the attention the PMs will receive. They may not be 'overnight sensations' but as history well shows, they are, in times of trouble, the 'only game in town'.

Should be 'fun' to watch the collapse don' you think? Much of the 'smart money' first entered in mid '05 when gold was testing the $400 mark, so if you do as the 'big boys' do, then you have followed along and enjoyed the ride. If not, then it's never too late, as 'a seed replanted still may grow'.

The House of Representatives has just approved a bill that would authorize the federal government to audit the Federal reserve. The bill may not go anywhere, but a growing number of individuals want more transparency in how the nation's central bank conducts its affairs.